The results are in from our most recent Entrepreneur Poll.

I asked you “What is the best business to start in a recession?” and you responded in record numbers!

The top 5 results were:

1. Online Business
2. It Doesn’t Matter – Just Love What You’re Doing
3. Healthcare
4. Education
5. Video Games

Here is what you had to say:

Online Business (11)

- Online Business for sure!
- I agree with Ninh, a web startup is something I am currently working on setting up.
- Online business. Selling information, no physical products.
Personally I have started a coaching business on self confidence, helping people conquer their self
defeating and limiting beliefs about life in general and the things around us.
- Do what I did. I started my own online travel agency. Great benefits and the cheapest flights ever.
- Online business and marketing is hot and it will continue in the future.
- I think that when times are tough people to startup an online business because, as long as they have the know-how to start it up, it will cost little (virtually nothing). Starting up a business that sells physical goods or services, on the other hand, takes much more investment in terms of money.
- Pursuing an online business is probably winning as it is one where you don’t have to throw in your old job – your start-up emails can be checked in lunch, you can work on it when you get home from the regular job and not have to worry about looking fresh and smart.
- Online seems to be the way to go but can I inquire what those suggesting an online business are actually selling?
Sky Minor.
- Timothy, I total agree with you. Right now America is facing a recession which is the closest thing we’ve seen to the Great Depression since the Great Depression. If you are an entrepreneur or an aspiring entrepreneur, creating low start-up cost business is the way to go. Where is the best place to make substantial sums of profit with extremely low start-up costs? the WEB.
- I’d say online business tools, to help businesses grow.
- A website for employment (since in my country, thousand of workers being laid off). Luckily, I wouldn’t need to find a job
- i suggest online business like selling in ebay, blogging and etc…..

It Doesn’t Matter – Just Love What You’re Doing (7)

- It doesn’t matter as long as it is something you love and are passionate about. The economy will always go up and down but you will have to stick with and push your business forward no matter what.
If you truly love what you do you will be successful in the end.
- I agree with Jared — as along as you are doing what you love, it doesn’t seem like work. If you can’t but happiness, you need to make it for yourself. You will put alot more energy and passion into a job you love than one you don’t, and customers/guests/consumers will see that passion and gravitate towards your company.
Yikes — sounded a little preachy, but very true!
- you can start any business as long as you have the passion for it and creativity in terms of differentiating yourself.
- Any time is a good time to start a business. You can always find a reason not to do something. If you’re passionate about what you do, it will resonate with your target audience. There is always opportunities for leaders to succeed. Sometimes too much thinking spoils the excitement. If it feels right take the chance.
If you fail – so what. Pick yourself up and try again. There are no guarantees, but the experience is well worth the effort. True entrepreneurs are invigorated by the challenges. Don’t look for recession-proof or any other protections because there are none. Every business can fail, and most new business do. But, if you believe in yourself and your customers – you will succeed. Build a winning brand, and enjoy the journey.
- You can start any type of business as far you do extensive market research before starting to see if its viable to you.
- Absolutely anything (to an extent)
I think the current recession is perfect for entrepreneurs! I believe it is possible to start a business in any sector as long as budgets are well thought out. I think if any venture has a well formed business plan and the capital available to stay a float for a year then they are almost certain to pick up clients from struggling companies and growth and success is almost guaranteed.
The companies that have been worst hit by this recession arent in the prcarious position because of a lack of sales they are in it due to a lack of planning. It is the larger companies that have been hit the hardest as many have over commited themselves and it is this which spells out the end for many companies.
If you can start a business now, and keep it running for a year, your likely to survive and most likely profit from it on the way.
- Be passionate about what you are marketing and/or the team you are building, or don’t even bother. Most of all be honest, realistic, and enjoy yourself so it won’t even feel like work. Avoid hype and ”get rich quick” scams at all cost. They never work. You have to…hard and consistently. Dedication is paramount.

Healthcare (6)

- Healthcare all the way! At least that is what I am working on right now. In a down economy people don’t stop getting sick, injured or old!
- Health care companies are known to do quite well in a recession because people get sick just as much and sometimes more. Also as baby boomers age, the market will surely grow quite a bit for products and services that assist people to live longer and a more comfortable life.
- Have to agree with the “health care” field – it’s never going to get smaller. And just thinking out loud – things/products/services that (1) make people feel better, or (2) make their life easier. How to lose weight. How to make money. How to find the love of your life. Those three “fields” (ideas) are never out of style and there’s always a demand – if you can sell *your* notion.
- These are the businesses that will survive no matter what the economy is doing, quite simply because they provide services that society in general cannot go long without. 1. Health Care: Health services occupations including medical assistants, home health aides, physical therapists and medical records technicians.
- I absolutely agree with Bizguy… Health care business never declines.
- I would think health care or credit repair/debt counseling.

Education (4)

- I have another thing to mention: A recession-proof business plan or eydea should involve the basic needs of consumers and the mainstay markets. Education will always be around. Energy. Food. And so on. Stay away from the luxury products/businesses or the type of business that is something most people consume if they have the extra dough ($)
- These are the businesses that will survive no matter what the economy is doing, quite simply because they provide services that society in general cannot go long without. 2.Education: Teaching is generally immune to a shaky economy, particularly if you’re teaching in an area with a high growth rate.
- Continued education (online and offline
- My number four is childrens abduction safety protection and educational business. If ever there was a recession proof business, this is it. With rising problem of children safety, with 850,000 reported missing children last year alone, what parent would not want their children protected from abduction or sexual molestation? This industry is ripe for growth with abducted children in the news every day, and getting worse every day. Low cost, no selling, just telling, a very solid choice in my experience researching this industry.

Video Games (4)

- I think video game is pretty good business. It’s recession proof.
- Video game programmer/designer (When times turn rough, people tend to stay home more. That means plenty of home movie nights, less eating out, and more video games.) Reports show that some video game companies sales were up 20% in 2008.
- I think a used video game store would be good to start.
- Video game business is one of those recession proof business. Also, used or recycled item shop is.
When you are in game business, you naturally deal used games also.

Here are some other popular entries that didn’t quite make the top 5.

Real Estate (3)

- In my area starting a business to take care of and maintain foreclosed properties would be good, this would be a nice on going business. You could also do a business to clean out the foreclosures.
- Besides Network Marketing companies, I think if you have large amounts of money to invest, that you should invest in real estate properties to rent out and keep for the long run. Only because the bank owned homes are going for such a good price, it is hard to ignore the good deals they have out there. My husband and I bought our first investment home back in September and it has worked out great.
- Speaking of real estate, a mainstay in the wealth building arena for years, and with the longest upward trend lasting 17 years, a record, it is all coming unwound, and in my area, prices have already receded back to 2004 levels, so this is a major hit on most people equity wealth which has evaporated over the past year, and continues to drop in most areas. See this trend, the best opportunity I have researched is a new home equity profit sharing concept which is so unique, it cannot be fully explained in one post. If I was to suggest the best recession proof business for the times, I would say this is my number one in my own personal seven recession proof list of businesses. Again, with banking collapse, sub prime mortgages are long gone, and never to return, and with banks not loaning, even after gov. bailout, 80% of previous home buyer market is now shut out of home ownership. Not only do you have to have 20% to 30% down, you have to have 720 plus FICO scores, so could you qualify for a new home in this market, ever with spotless credit?

Adult Entertainment (3)

- I have to be the one to say it? Adult Entertainment
- We have been expanding into the Adult arena as we can see this being good in Recession and beyond.
- sex is a cheap alternative to going out so sell them sex toys and porn

Renewable Energy / Ecological Living (3)

- Also I think renewable energy, ecological living, ecological housing could be viable option.
- Anything having to do with ecological awareness and infrastructure for broadband connectivity. These are two of the fields that Obama is going to use to try and recreate the “New Deal” for this economy. If you are developing a startup in these industries you can almost count on a governmental grant in the near future.
- My number two recession proof business is the Environmental Energy Audit Industry. With so many businesses trying to survive, saving money is critical, and since every business is bleeding wasted energy, this is a gold mine if you are looking for a low startup, low overhead home business. Having been in contruction, I can tell you first hand how many contractors took shortcuts in the good times and combined with low energy costs for years, these small to medium buildings are energy inefficient, and with 5M plus businesses in this catagory, you can make a small fortune even part time if you have business contacts. Learning the business is easy, and with a little effort, this can easily be a full time business, so perfect for those who are not comfortable in their current jobs. Energy auditors and consultants are good long term businesses as we are all more green motivated now, so you have two points to approach business owners with, saving money, and going green.

Network Marketing (3)

- I know that many people are misinformed about Multi-level Marketing companies aka. network marketing. I have been network marketing for over 2 years now and I have seen a big jump in my business lately. Maybe it is because of the low costs compare to other companies and that the products are Jerky and snacks that people consume and reorder. But I also think it is because so many people are being laid off and are turning to the internet to look for a home based business and I am ranked on some of the search engines in the first couple pages.
- network marketing and online/home business are extremely viable
- Find a product you like that you can distribute! Network Marketing can be such an inexpensive way to create additional income.

Liquor / Beer Store (3)

- A drive through liquor and beer store. Sell cigarettes, drug paraphernalia, liquor, lottery tickets, liquor, and beer… Set up shop in the worst part of town and hire a few big dudes to handle security/check out… Put them on rotating shifts.
- +1 on the liquor store
- people need to drown their sorrows so sell them alcohol

A Product/Service That Helps Save Companies Money (3)

- I work in the high tech (software) industry, and i have a different opinion from most folks who think that high tech is most impacted in a recession.. My thoughts are this really depends on the type of product/service your company can provide..if you can come up with a product/service that actually helps save companies money overall(or better still make more money), they will jump on the opportunity as everyone is looking to shave off those extra dollars..On the other hand, a product/service that is more of a nice to have that sits pretty on the shelf will not sell in such a climate..selling vitamins vs selling painkillers analogy kinda works great to gauge the likely hood of what products/services will fly in such an economic climate.. My $0.02
- The success of a business relies on how well it gives customers what they want/need. During a recession I believe it is the same thing. Just do “it” better than the rest of the guys (the competition) and you should be fine. “It” could be any commodity.
- Products/Services based on needs rather than wants that will not require people to change their buying habits will offer the greatest potential for success and residual income. Work smart and stick to what works. Use the Internet as an invaluable resource for generating endless targeted leads so you don’t have to rely on family and friends who often end up being your harshest critics. Brand YOU Inc. and establish yourself as a knowledgeable leader and people will seek you out, rather than you having to chase them.

Web Development (2)

- I’m actually starting a website development LLC at the end of this month / early next month. Web development is a great business to enter if you plan to bootstrap. You can use software like Gimp for free (and later upgrade to Photoshop when money permits).
- Personally, I was laid off back in July of 2008 and needed to do something rather quickly and started a small web design business. I have been really surprised that even during this slow down in the economy of how busy I am. This may not be the case everywhere but if you have the skills I would suggest this line of work because of the low overhead and start up costs especially if you already have good pc or laptop and design software.I think one major reason I am staying busy is because small businesses are looking for alternative ways to garner new business and a website is one avenue.

Personal and Repair Services (2)

- Cars and trucks still break down, plumbing gets backed up, and the lawn mower still has issues. So electrical, plumbing, termite proofing, roof repair, lawn care, and other specific home-repair functions should continue to do well in a recession. While homeowners may try and put off maintenance and repairs, that only means that ultimately they will pay a higher price for a greater amount of work as things tend to get worse if not fixed.
- Shoe Repair (as people look to repair not replace)

Credit Repair (2)

- credit repair lol
- I would think health care or credit repair/debt counseling.

Biotech

- I vote for biotech. See my blog on 12/30 on this subject “Biotech Startups are Hot” by linking from www.startupprofessionals.com. Also a see a related one “Recession Means Selected Startups Can Win Big”. Marty Zwilling, CEO & Founder, Startup Professionals
- The guy who said Biotech is 100% uneducated on the subject. The funding for Biotechs is 100% dried up. There are currently 300 or so public Biotechs and over 1/2 of those have less than 1 years cash on hand. 50% of those have less than 6 months cash.Fact is, biotechs are hurting right now and many, many will go under in the next year. A BAD time to start a Biotech firm.

Payroll Check Cashing Business

- Payroll Check Cashing Business…..more and more people lose their credit ratings in a recession. They are unable to get a bank account, those who specialize in high risk loans and credit offerings stand to gain tremendously in this sort of environment.

Receiver / Debt Recovery

- Being a receiver would probably do well in a recession! As would a debt recovery business! Couldn’t say I’d enjoy either though…Sean

Recruitment Agency

- I’d like to say recruitment agency, but I don’t think there are that many companies hiring – I guess it falls both ways.

Small Business

- Another good market to focus on are small businesses. There are millions of small businesses who have a vast array of problems. A startup only needs to focus on a niche solution for these businesses and charge a nominal fee per month to make Profit! =)

Infrastructure

- I would suggest to do something connected with infrastructure. This seems to do well in bad times.

Pet Shop

- I’m thinking about a pet shop. Do ya think it’s a good aidea?

Just Get A Job

- just get another jobs, never start on your business

Home Inventory

- I plan on starting a home inventory business for my retirement. Well, actually I want to be up and running when I retire.
This appears to be a up and coming industry. I’ve done some research and it seems to be wide open in my area. This is my first business venture and sites like this are a great resource. Thanks

Dating, Love, Marriage

- Growth of the general-interest online dating sites has slowed nationwide, but the carefully targeted new niche dating markets has seemed to be growing. Site that are aimed at specific market segments, such as specific religions or Baby boomer singles or a particular ethnic focus.

Technology

- And some technology fields are still growing!!

Financial Consulting

- Hello all! New member this is my first post, I must say I really like this forum alot and am happy to be a member of the community. I must say a great business to start during these tough economic time’s would be a financial consultant company.. just a company out there to help people who may be feeling the panic of the current economy. Alot of people these days are going to consult with financial advisors and things of this nature and in turn that is producing a good steady flow of activity for the advisors. I myself am a personal investor.. i play in several markets ranging from the Forex market to the day trading the stock market (If your not investing in the market right now you are missing out on a great opportunity) and i find my friends and family turning to me in near panic asking for help with financial issues. they are always wanting to know what to inest in and where to put there money when to get out when to get in just all kinds of things. Financial Consultants are making the money right now due to the downturns of the market and if you know your stuff you can as well.

Forums

- I think forums are the way to go in times of Recession, so I would say FORUMS!

Dollar Stores

- Dollar Stores

Healthy Food

- Healthy alternatives to cheap, fast food chains.

Death Industry

- In my general research, the number one growth industry is the death industry, as in, funeral homes, cemeteries, casket companes, etc. After all, we are all going to die, and with babyboomers reaching this final phase in their lives, 70M or so, this is the business to be in. The only real estate you will see appreciating in value over the next five years will be cemetery plots as I see it.

Discount Cooperative

- My number five is a discount business cooperative, similar to Chamber of Commerce, whereby you offer members group benefits such as reduced health care which is most common benefit of memberhip. Anyone who is or was member of any local chamber will understand what I am talking about. But with this cooperative membership, you not only access low cost health care, but low cost advertising and every other critical aspect of running a business at discount. This is one of the easiest businesses to promote to other businesses desperate to save money. Sadly, in a recession, most businesses cut advertising first, and this is suicide in business, yet most don’t know this until it is too late. Trimming advertising is important, but from a cost point, not eliminating it, and that is what this business cooperative is all about, saving money, finding more cost efficient advertising, not wasting money.

Non Tobacco Cigarettes

- My number six was a no brainer. With smokers always making a new years resolution to kick the habit, never mind the new health care tobacco taxes which will bring a pack to over $10.00 in most areas, this is an industry which is booming. As the recession is hitting smokers too, here is a money saving and life saving alternative, electronic nano non tobacco cigarettes. With no tobacco taxes, plus the cartridge system, a smoker can save hundreds, if not thousands over the year, in fact, most won’t pay anything if they also choose to be in the business sharing technology with other smokers. Once people see it, they want it. Simply put, this product sells itself, and for this reason, the perfect recession proof business as smokers look to save money, even if they don’t care about saving their lives. After all, the cancer, heart disease and emphysema issues are well proven, so here are two powerful reasons why people would want to stop smoking tobacco, or kick the nicotine addiction.

Pawn Shop

- My number seven is addrssing the big ticket luxury millionaires market. With the Madoff $50B ponzi, many millionaires lost everything, and with the stock market collapse, trillions have been lost requiring the disposal of luxury big ticket items like, yachts, exotic motorcars, mansions, jewelry, antiques, paintings, you name it, the rich are going to be dumping it. This is a rising star in my portfolio, about to launch, and well worth adding to anyones list as you will soon see. Pawn shops are booming, look at the online gold exchange industry, also exploding, so again, anything which addresses the impact the recession has on everyone will be the businesses to choose for the long term.

Used Articles

- Used articles for consignment. People are needing to save a dime even more these days.

Thank you everyone for the fantastic feedback! We’ll continue again next week with a brand new entrepreneur poll!

It’s time for another SEO Advice post! Last week, I offered free SEO advice to Capability Events. I’m going to continue my SEO Advice series today by helping out another YoungEntrepreneur.com blog reader Paula from CADrite.

Paula – www.CADrite.net

Dear Evan.

We have started a CAD services venture and I would really appreciate your comments and suggestions about our site:

http://www.cadrite.net

thanks
Paula

My Recommendations

1) Build More Links

At first glance you’ve optimized your title tags, put text on the homepage, and have relevant content. But your page currently has no Page Rank. If it’s a brand new site then you’re likely in the Google Sandbox and will have to wait a few months before you start getting ranked. The fastest way out of the Sandbox and into Google’s main index is to build links. This blog post is a good start! Get involved in the CAD community, post on related blogs, create content on your site that is link-worthy and submit your site to relevant directories to begin the link building process. Once you get links and Page Rank you’ll have an easier time ranking for your keywords.

2) Change Up Your Title Tags

Your title tag on your homepage reads:

When I browse to your Services page guess what the title tag contains? The exact same keywords as your home page! Your title tag is a critical SEO component and you want to make sure that it is different on every page on your site to give each page the ability to rank separately.

3) Add More Content

The only page with any significant amount of text is your Services page. I would encourage you to instead of putting all of your services on one page, separate them so that they each have their own page. Write 300-500 words of content on each page, have relevant title tags, and a relevant url for each. For example, your CAD Data Translation service should be on its own page with 300-500 words of targeted text which will help you rank in Google for “CAD Data Translation”. Rinse and repeat for all your other services.
Good luck Paula!

Readers, what do you think about CADrite?

To learn more about how to get SEO tips for your website please read my post: Need SEO Advice? Submit Your Site!

Last week I wrote about the startup of my most recent business (7 Steps To Build A Startup From Scratch With No Money) and it received a number of comments so I thought I would expand on Step 1 from the post and talk about 5 sure-fire ways to know if your business will work.

#1: You Love It

After I found out that I could make money online through advertising I went out looking for the highest paying keywords and tried to make different pages and mini-sites that targeted those words. I saw that keywords like “Arizona DUI lawyer” was going for $47.45 per click. $47.45 for every click!!!
I quickly got lost in the math – if I could get 10,000 people to that page per month and 10% click through on my ads and Google takes 50%… that’s $23,725 per month! Even if I only hit 25% of that it’s still almost $6,000 per month for one site! Now imagine if I could do the same thing for multiple keywords!

Unfortunately the buzz quickly wore off. It takes time to write content, build links, and promote your site. No matter how promising it seemed, I drained myself pretty quickly and abandoned the site. If you don’t truly love what you do then you won’t stick with it. Imagine it takes three years before you are successful. Would you be willing to write articles and build links every day on “Arizona DUI lawyer” for three years? Probably not. That’s why people are making more money selling their lists of the top paying keywords rather than trying to optimize their sites for those keywords themselves. So find something that will get you going every morning.

#2: There Is Money To Be Made

Yesterday I made $7.56 from one just click on an ad on my site. It’s not the $47.45 from “Arizona DUI lawyer” but it’s still pretty good. You need to make sure that there is a way to make money in the industry you’re targeting. If you’re going to be selling ad space online like I do then use Google’s tool to find out how much clicks are going for. I hear about people starting online businesses and making $0.05 per click. No matter how great a job you do on driving traffic to your site and optimizing your ad placements to maximize your click through rates (CTRs), you’re not going to be making a living from your website. It might be a great hobby but it’s not going to put food on the table.

Whatever industry you’re going into make sure to do your research and find out if there is money to be made. If it’s not an online business go out and talk to people who are in the industry and see how they’re doing. Are they hiring new staff and expanding or are they closing down their businesses? Figure out if your idea is actually a good business opportunity or just a hobby project to have some fun with.

#3: You Can Do All The Important Aspects Of The Business Yourself

I have a number of friends who are starting online businesses and don’t know anything about programming, web design, servers, content writing, search engine optimization, or link building. They think they can just outsource everything. If you’re a retail store and you’re selling some of your products online then I would say it’s ok to outsource. But if your entire business is online then you better know how to run the most important components yourself! There are going to be problems that come up that you are going to have to know how to fix yourself and, let’s face it, entrepreneurs are strapped for cash. Soon you’ll be settling with a substandard product because you can’t afford to bring in the pros to do it for you.

If you’re going to go into any business, make sure that you are the pro. You can hire pros around you as well as you grow but you need to know what you’re doing as the chief of the company. If you’re not a pro at what your business is selling then don’t go into that business until you can be the pro. Don’t start an online business if you don’t know anything about how to operate an online business.

#4: You Can Bootstrap It Yourself

I used to work in a venture capital company and helped entrepreneurs raise $500,000 to $15,000,000 for their businesses. That being said, I’ve never raised capital for any of my businesses. I believe the best way to go is always to bootstrap. Build around customers, reinvest your profits, and make sure you have something that people want. For every one company that hits it big with venture capital there are 10 who crash out because they were forced to grow too quickly and were on the wrong path. Raising money also becomes a full time job which takes you away from being able to run your business.

Think big but start small. Find a way to get your business started right away. That might mean doing a service instead of a product which is costly to get started. If you can bootstrap your business and get to the level where you can support yourself on a full time basis you have a much greater chance of success than taking someone else’s money, having them breathe down your neck, and running a negative balance every month hoping that you’ll cross into profitability before you run out of money.

#5: You Have Customers Lined Up

In one of my businesses I spent an entire summer writing a business plan around a particular customer that I thought was a sure-fire hit! Unfortunately after the summer ended I pitched the idea to them and they weren’t interested. Back to the drawing board for me and I lost three months of my life planning what I thought was the “perfect business.”

The best business you can build is one where you don’t produce anything until you have money from your customer in your bank account. This guarantees that you won’t run out of cash as you build your business. Being able to have customers lined up comes from knowing your industry and having some contacts in it before you get started. If you were to start today do you have someone who you could sell to immediately? The quicker you can get customers in the door the greater your chances are of success. Some of the most successful entrepreneurs I know started their companies by either working for a company and taking their clients with them or by reselling their services back to the company as a contractor instead of an employee. Having money come in from day one relieves a lot of the stresses of running a business. If you’re in month three and still haven’t made anything, panic starts to set in which causes poor decision making. Try to find a way to get a customer signed up before you even start your business.

What would you add to the list of “Sure-fire ways to know if your business will work or not”?

Last August I did a profile on Bill Hewlett and Dave Packard that focused on making a contribution (Make A Contribution – Hewlett-Packard).

I wanted to continue to story today by sharing another Hewlett-Packard nugget of wisdom – make sure you have the guts to be an entrepreneur.

“We were just opportunistic,” said Hewlett. “We did anything to bring in a nickel. We made a bowling alley foul-line indicator, a clock drive for a telescope, a thing to make a urinal flush automatically, and a shock machine to make people lose weight.”

To outsiders, and even to their own staff on occasion, Hewlett and Packard could have seemed like just your average friendly college buddies. Indeed, when the company began to experience modest success, one newspaper ran a story on its two founders under the headline, “Boy Scouts on a Rampage.” But despite their seemingly compassionate natures and generous human resource management policies, Hewlett and Packard were in business to make a buck. And, when it came down to it, they were willing to do whatever it took to get on top.

In 1969, U.S. President Richard Nixon appointed Packard as the U.S. Deputy Secretary of Defense. It was a role Packard thrived in until 1971, when he realized that the company he had co-founded was in trouble. Packard resigned from his government post and returned to HP as chairman of the board.

HP was suffering from extreme cash-flow shortfalls. The management at the time had decided to borrow $100 million in long-term debt to cover the company. But Hewlett and Packard, both of whom had witnessed the disastrous effects of the Depression first-hand, refused to finance their growth with anything other than profits.

Almost immediately, Packard set out on a company-wide tour, in which he planned to lay down the law. At the company’s plant in Santa Rosa, Packard gather together all of the employees and lined up the division managers in front of them. “If they don’t get inventories under control, they’re not going to be your managers for very long,” Packard told the workers. It was just one of many incidents that would come to be known as “Dave Gives ’Em Hell Speeches.” It worked, however.

Within six months, the company had turned itself around and even had a $40 million cash surplus.

Hewlett and Packard wanted to create an environment based on egalitarianism and openness, but they also knew when the time came to be the boss. It was that spirit and nerve that both looked for in others. They wanted to be working with people who had the gumption to go for what they wanted.

That is why when 12 year old Steve Jobs, future co-founder of Apple Computer, looked up Hewlett in the phone book and decided to call him at home one day to ask him for spare parts for a school project, Hewlett did not hang up; he listened. Jobs was trying to find spare parts for a frequency counter, and what better way to get it than to call up the HP co-founder himself, he thought. At first, Hewlett could only laugh at the bravery of this young boy. But by the time Jobs hung up, he not only had a promise for the parts he needed, but he also found himself with a summer job at HP.

HP was a company founded on ambition and pure guts, and that is what Hewlett and Packard looked for in the rest of their team.

Due to the popularity of our recent entrepreneur poll on starting a business in a recession (What Is The Best Business To Start Up In A Recession? – Entrepreneur Poll, Update, Update 2) I thought it would be valuable to focus this week’s Entrepreneur University on how business owners can make the recession work for them.

Therefore this week’s Entrepreneur University comes thanks to Mark Levit. Mark is the founder and managing partner of Partners & Levit, Inc., a New York advertising agency. He is also a Professor of Marketing at New York University. Mark’s career in marketing spans 3 decades at both major client and agency organizations. Today Mark discusses how you can make tough economic times work for you.

“As the economic cycle spins, marketers look forward to the economic highs and dread inevitable recessions. When the economy goes sour, how do brands stay alive? During an economic slump, advertising budgets tend to be the first item cut. But history strongly suggests advertising budgets should be increased during a recession.

Cutting marketing and sales budgets during recessionary periods changes long-term results. A key reason is that when advertising “noise” decreases, the voice of those still talking sound that much louder. When the competition stops or reduces their advertising efforts, it’s a prime opportunity for your brand’s message to be heard. Since your message is one of the few messages reaching customers, the odds of success are multiplied.
American Business Press, in its book “How Advertising in Recession Periods Affects Sales,” states: “The findings of the six recession studies to date present formidable evidence that cutting advertising appropriations in times of economic downturns can result in both immediate and long-term negative effects on sales and profit levels.”

The Buchen Agency measured the effects of advertising for business-to-business marketers through successive recessions in 1949, 1954, 1958 and 1961. They found that not only sales and profits dropped off for those companies that cut their advertising, but in addition, when the recovery came about, these same companies also lagged behind those who didn’t cut back.

In good times, marketing is important, in bad times, it’s vital. During tough times, customers look for specific qualities in a brand such as value. When customers are in need, satisfy the need. During a recession market dynamics change drastically. The key is knowing what your customers need, not what they want. Here are some simple guidelines for successful recessionary marketing:

Focus on Branding
* It’s safe to assume customers will be price conscious during a recession. Therefore, it’s normal to assume that before making decisions, customers will do more “shopping around” than usual. For this reason, marketers must focus on ways to make their brands stand out from the rest and address the customer’s doubts. Brand messages should focus on practical uses of the product and demonstrate how customers are getting high quality for a low price (value). Establishing a system of feedback for customers will also help to distinguish your product. The key to successful recessionary marketing is emphasizing value. During an economic boom customers are much more likely to pay high prices. When times are bad customers are much more careful with their money. So marketers must focus on different aspects of their products.

Focus on Customers
* During a recession marketers need to focus on current customers, not just new ones. The assumption that any business is good business is not the case here. The best prospect is a current customer. Acquiring new customers is five times more costly than retaining existing ones. Bad times can be used to focus on existing customers and turning them into loyal customers. That can be accomplished by researching customer needs and the ability of your product (and competitors’ products) to meet these goals.

Marketing Focus
* During a recessionary period, marketers should focus on the strong points of their brands and align them with their customers’ needs. A comprehensive marketing plan can help to position brands and to capture and maintain loyal customers and profitability. A long and objective look must be taken at your brand’s current marketing activities, focusing on those with greater potential.

Recessions are never desirable, but they are inevitable. Using the right marketing strategy during tough times is the best way for your brand to survive. Importantly, don’t decrease advertising activity. Get to know your customers and think of new ways to create value in your brand—and to distinguish your brand from others.

Learn more about strengthening your brand in a down-turned market. Contact our Managing Partner, Mark Levit at 212.696.1200.”

Is there a topic you would like to learn more about for the next Entrepreneur University? Leave a comment below and we’ll try to find an expert to discuss your topic!

It’s time for another SEO Advice post! Last week, I offered free SEO advice to Tivoli Couture. I’m going to continue my SEO Advice series today by helping out another YoungEntrepreneur.com blog reader Ben Leeke from Capability Events.

Ben Leeke – www.capabilityevents.co.uk

Hi Evan,

My company organises parties and events. My team are passionate party professionals and we strive to produce the best parties for our clients. Everybody loves a great party. We try to bring this across in our website but are only getting low page ranks and our blog seems to be pointless. We have almost given up on it as a traffic generating tool.

Can you look over www.capabilityevents.co.uk and see what we could do to get more than our 200 visits a day.

Yours,

Ben Leeke

My Recommendations

1) Don’t Give Up!!!

SEO takes time and doesn’t happen overnight. Try to set aside some time every week or, even better, every day to build your SEO efforts. Consistent work will pay off. Whether it’s writing a new article, building new links, or further optimizing your content, remember that slow and steady will always beat a fast startup with no follow through.

2) Use Better Keywords

Right now the keywords in your title tag are: “Capability Events, Private party and Corporate Event Organisers, Event Management, Party Organisation, Event Planning, Mobile Bars, Cocktail Bars”. You already rank #1 for Capability Events so you can take that one out (it’s in your domain name). The other keywords are far too broad fo you to rank in a competitive industry. Event Management, for example, is too general. If you want to rank you should consider using a more targeted version of it by adding another word or even two to the equation.

3) Get More Links

Your Page Rank is currently “unranked”. No matter how much on site optimization you do, it will be vitually impossible to rank for competitive keywords unless you build up some links to your site. This blog post is a good start! See if you can get your partners to put a link to you, submit your site to relevant directories, publish articles for different websites, and build those links to your site!

Good luck Ben!

Readers, what do you think about Capability Events?

To learn more about how to get SEO tips for your website please read my post: Need SEO Advice? Submit Your Site!

I recently did an interview about how to build a business up from scratch with little or no money and I used my own story as an example.

Here are the steps that I took.

This process helped me build my business with $0 in startup capital.

Hopefully you can learn from my experience and make it even better.

Step 1: Moonlight Until You Find Something That Works

I’m a big believer in not spending until I’m earning so I started my company while working at a venture capital firm in Toronto. I used my site to drive traffic, expose myself as an expert, and drive leads for the venture capital firm. I was driving thousands of people to my website and began to wonder if there was a way to monetize that traffic beyond lead generation for the venture capital company.

I found out about Google AdSense and put it up on the site as an additional revenue generator. In my first month (January 2005), I made $8.38 – not much to write home about.

Step 2:  Tweak, Tweak, Tweak

Too many entrepreneurs jump full in with no plan and no proof that your idea will work. It’s always better to tweak the concept while you already have some sort of stability in your income. I wasn’t about to go full time making $8.38 a month.

My next step was to learn as much as I could about how to better optimize my ads and how to drive more traffic to my site. I read every ebook, blog, newspaper article, and website that I could get my hands on. There were a lot fewer resources than there are today. I learned as much as I could in the extra time I had and implemented the ideas I learned. Slowly I started making more and more money.

Step 3: Go Full Time

I looked at how much I was spending on my apartment, food, entertainment, etc and once I started to hit that revenue number with my website, I jumped ship and did my business full time. It wasn’t a lavish lifestyle by any stretch but I wouldn’t have to worry about paying my monthly bills. I knew that if I was able to build a site in my spare time that could support my entire lifestyle, then if I gave it a full go, I would be able to do much much more!

Step 4: Get Free Help

As your typical entrepreneur I wanted to grow very quickly and took on too many responsibilities. I was doing manual data entry when I should have been doing more value-add work. But that manual work still needed to get done. The solution? Get free interns. I started with foreign language interns. They were basically university students who came to Canada on a student visa for work experience but they couldn’t get paid for the work. I couldn’t give them too many communications projects because English was their second language but I was able to unload a lot of the work off of my plate.

The next free help I got was from high school students who were on a co-op term. I was able to give them more tasks where they were able to connect with partners and customers because they were fluent in English. They sounded very young on the phone so they usually stuck with email.

Step 5: Hire Part Time Help

At some point you’re going to need more skilled labor than the free interns. They were a stepping stone to help you grow and take some of the work off of your plate but you’ll eventually get to the stage where you need people who don’t need as much hand-holding. But you don’t have enough money coming in to support both you and them. The solution? Hire part time workers. The first guy I hired was for one hour per day to update my database. He worked for me for five hours per week which was much more easy to manage. I wasn’t going broke and I got a skilled worker to help me grow my business. It wasn’t as fast as I would have liked, but it was growing nonetheless.

I hired people to create code for my website, write articles, do marketing projects, edit content, sell advertising… almost anything you can think of. But they were all part time to start. I had an entire organization running with people working only a couple of hours per day. The good thing was that they worked every day… so every day we made progress forward. I found people using elance as well as hired friends and family who wanted to help as well as make an extra pay check. At one point I had eight part time people working for me.

Step 6: Hire Full Time Help

Just like you eventually outgrow your interns, you will also eventually outgrow your part time help. At some point you’ll realize that it’s too much work to co-ordinate all the various part time staff and you need more from them. Some may be able to step into full time roles while others will not be able to commit to more hours because of the other jobs they have. You’ll likely end up having less workers but will get more work done. For example, when I hired my marketing manager, he was originally one of the guys working for me on a part time basis. By hiring him I ended up not needing four other people who were working with me in marketing related positions part time.

Step 7: Figure Out Your Job Description

This is where I’m at now. What is it that I love to do and who do I need to hire to take over the jobs that I don’t want to do anymore? In January I brought on two new full time people to free up more of my time. When you’re first starting a business you end up wearing all the hats but as you grow I believe the whole point of entrepreneurship is to do something you love doing. If you have the opportunity to design the perfect job, why not go for it?

I would love to hear your thoughts on how you’ve built your business up or how you plan to do it if you had a $0 budget.

In April I did a profile of Pierre Omidyar (Pursue Your Passion – Pierre Omidyar (founder of eBay)). The post was one of our more popular ones and received almost 20 comments.

I wanted to continue the story today by sharing more wisdom from Omidyar.

“I was raised with the notion that you can do pretty much anything you want,” says Omidyar. “I always kind of just went ahead and tried things.”

On that fateful Labour Day in 1995, when eBay was launched, Omidyar was doing exactly that – trying something new. eBay was nothing more than an experiment and a side hobby for the budding software engineer. “What would happen within a marketplace if everyone had equal access to information and tools?” Omidyar wondered. “Would a level playing field enable individuals to compete alongside big businesses? What if members managed their own transactions and accountability?” He didn’t know the answers to these questions, but he wanted to find out.

“A lot of people don’t just go ahead and try things,” says Omidyar. “They’ll have an idea and they’ll say – they’ll convince themselves or other people will convince them that it can’t be done.” And of these two, Omidyar says “the first is even more dangerous and serious. It’s convincing yourself that it can’t be done.” This is a mindset that Omidyar says he never learned. “I just kind of had this naïve approach to – well, gee, you know, why not. I’ll just go ahead and do it.”

Omidyar wanted to help people to do business directly with one another over the Internet, but there were few who believed his vision would ever work. How could people trust each other enough to do business, wondered his critics. How could they develop relationships with each other when they were relatively autonomous? “I thought that was silly,” recalls Omidyar. “It was a silly concern because people are basically good, honest people. So that was very motivating. It was, ‘Gee, I’ll just do it. I’ll just show them. Let’s see what happens.’” It wasn’t until Omidyar began earning more from this ‘experiment’ than his day job that he realized his trial had paid off. And, it is precisely this trial and error process that Omidyar seeks out.

“I’ve got a passion for solving a problem that I think I can solve in a new way,” he says. “Not the difficult problems that some of the physicists that are here, for example, are talking about, but problems that seem easily solvable, that no one has bothered to attack because they think it’s impossible.” Omidyar is the first to admit that he has made mistakes along the way, but it was a learning experience that led him on the path to being at the point where he was able to develop eBay.

“Don’t let people who you may respect and who you believe know what they’re talking about, don’t let them tell you it can’t be done,” says Omidyar, “because often they will tell you it can’t be done, and it’s just because they don’t have the courage to try.”

So, just go ahead and do whatever you’re itching to do, says Omidyar. Try it and learn from it. After all, “You’re able to accomplish anything you set out to accomplish.”

One of our blog readers, Brenda, asked to learn more about business plans:

“Hi, this is a great article… thanks! I would like to hear something about business plans if that is convenient. Regards, Brenda”

So this week our Entrepreneur University comes thanks to Dave Turkin. Dave, of Accessible Business Consultants, is a full service business consultant that has over 32 years of experience working with small-medium size businesses. Dave has designed and implemented numerous business and marketing plans, designed internal programs for accounting and operational procedures. We featured Dave in November when he wrote about How To Do An Annual Business Checkup.

To help Brenda out with Dave discusses today what a business plan should look like:

There are many clichés and misunderstandings surrounding Business and Marketing Plans than any other part of the capital raising process. These range from the belief that plans are not needed (my concept is so good it sells itself) to the “thicker the better” school of Business Plans. I have seen Business Plans that are over 100 pages that includes 25 pages of newspaper clippings and a scholarly treatise on the industry complete with an additional 20 pages of charts and graphs, which by initial sight is very impressive, but never read. The failure of this approach stems from a misunderstanding of the role of a Business Plan in the world of capital venture.

Contrary to popular belief, no capital venture firm or “angel investor” hears a presentation or reads a plan and becomes so excited that he sits down and writes a check immediately. An Angel Investor is no different than a capital venture firm, bank or insurance company in his or her desire to make a prudent and sound investment. I have heard client’s state that Angel Investors or Venture Capitalists are no better than banks or traditional lenders because they want experience management, collateral, growth industries, and ability to repay the loan as well as significant returns on their investment. They thought an Angel Investor suspended all prudent business practices and just threw money into any project presented to them. Nothing could be further from the truth. Each venture capital source must present a detailed Business Plan to a committee or advisors to determine if further processing is warranted. The Business Plan is the door opener, if the plan is favorably received the company will proceed to the next step, due diligence.

What does the Lending Community want to see in a Business Plan? The projects that are selected achieve a business comfort level that encourages further pursuit. If the business is inherently unsound, a skillfully drafted plan can not cure the flaws, nor does a poorly written plan automatically condemn an excellent company’s chance for financing, however the poorly written plan

What do capital sources want to see in a Business Plan?

• What is unique about this company or project?
• What does the company do?
• How will the company succeed and attain profitability?
• What benefits will be derived from a capital infusion?
• Is management capable of implementing the Business Plan?
• Do the Financial Projections Make sense/are they realistic?
• Is there an exit strategy for the investor?

A Look at Business Plans
Page Two…

The Don’ts of A Business Plan

• Don’t provide only an income statement; include a balance sheet and a cash flow statement too.
• Provide monthly data for at least two years.
• Don’t provide more than two years worth of projections unless the lender or investor has asked for them.
• Don’t provide different scenarios in your projections.
• Don’t assume the numbers reconcile.
• Don’t be too optimistic about sales, growth or operating profit margins.
• Don’t forget to include all existing debts.
• Don’t forget to add reasonable interest rates for the loan you are seeking.
• Don’t forget to include assumptions to your projections, be able to explain as well as defend them.
• Don’t believe the investor will be the only one at risk

If the Business Plan is prepared properly and answers the questions as indicated above it has served its purpose. Remember that it is the job of the lender, venture capitalists or angel investor to ask questions.

Does the format and style of the Business Plan make a difference to an investor? It definitely does. Most investors look more favorably upon a Business Plan that is professionally prepared, easy to read, well laid out and written in acceptable business plan style.

The style of a good Business Plan is unique. It is between the syntax of a SEC document in which every aspect of the business is doomed to failure and a marketing piece in which everything about the business is wonderful. It is a factual document, but it also a presentation piece, in which the positives can be featured, but not overly emphasized, and the negatives are disclosed as well as explained.

An attractive professionally packaged Business Plan can be beneficial. Always set a positive tone, and don’t turn off the reader with a large number of pictures or a volume of the encyclopedia.

A Look at Business Plans
Page Three…

Should an existing business or start-up hire a consultant or professional business plan writer?

This is a question of time, ability and money. A typical Business Plan takes at least 20-50 hours to reach a final project when prepared by a professional. It will take considerably longer if a learning process or research process is involved. There are many software programs to serve as guides, but most of them not worth the price they cost. Business Plans require a high level of writing ability to draft the plan, a real understanding of the business environment and industry, financial knowledge of the proper accounting methods and preparation of budgets and projections. So the answer to the question is that if the business or start-up has the ability and the time, it is a feasible option.

Retaining a professional consultant has many advantages. Since a Business Consultant, who prepares Business Plans for a living, can be produced faster and written at a professional investor friendly level. The consultant is also detached from the business allowing for a realistic presentation of the business and its future. Investors can always detect a Business Plan prepared from a software package (“canned”) versus a professional prepared plan. Investors favorably note that the company or individual has gone through the expense to present a professionally prepared plan, understand the importance of utilizing professionals and are serious about their business. The cost of having a plan professionally prepared is small in comparison to the amount of money the average business is seeking. Business Plans usually start at $3,000 and can increase to $7,500 or more depending upon the complexity of the Business Plan.

A professionally prepared Business and Marketing Plan, designed by a Business Consultant, is usually an excellent investment for all businesses.”

Is there a topic you would like to learn more about for the next Entrepreneur University? Leave a comment below and we’ll try to find an expert to discuss your topic!